General management, Risk and uncertainty

Zooming out to look at “risks” more effectively

Photo by _chrisUKIt’s difficult to move from a so-called “risk” to looking at things in a more practical way. But I find if we “zoom out” it helps a lot.

I’ve written previously about how we mistakenly tend to think about “risks” as if they are tangible things. This is something I’ve taken from Matthew Leitch, who has been saying it for a long time:

For many people involved in risk management the word ‘risk’ has come to mean a thing with a real existence in the outside world. Risks are to be identified, not defined. They have boundaries that we cannot change. This is fundamentally wrong…

That’s why I tend to put “a risk” in scare quotes. One of the problems with treating “a risk” as a concrete thing is that it stops us looking at potential problems in a very practical way. When people talk about “a risk” they tend to mean “a risk event”—a very specific thing occurring.

But the reality is that life is rarely binary. There are degrees of success and failure. We may have “a risk” that the project overruns (risk event: a date passes and there is still work to do) but there is huge variability in this. It’s less critical if certain kinds of work are outstanding, more critical if there are other kinds. There is a difference between a day of work outstanding against a year of work outstanding.

One of the things I try to do is “zoom out” to get away from the risk event. The question I ask is, “We’re taking about X, but isn’t this really about…?” The idea is to get to look at the bigger picture by finishing that sentence. In our example of a project overrunning perhaps we might say, “Isn’t this really about having an all-or-nothing idea of completion?”

As another example we might start with a so-called risk of “our CEO might hate what we produce”. But looking at the bigger picture we might zoom out and ask “Isn’t this really about stakeholder management?”

Recently someone told me about a government quango which had “a risk” of having its funding from government cut substantially. That event really did happen, but I couldn’t help trying to zoom out to find the bigger picture. Isn’t this really about being too dependent on a single source of funding? What if they had started asking about that? Rather than being passive victims, could they have spent time and effort cultivating other sources of funding?

Zooming out takes practice. It took me a bit of thought to get to that last way of zooming out, after I’d been introduced to the problem. And clearly that potential solution is an enormous undertaking. But if the organisation’s fundamental capability is really under threat, perhaps it’s an appropriate one.

I find zooming out tends to give a different perspective on otherwise intractable problems. Practising it can be worthwhile.

Photo by _chrisUK



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